Office Depot Visa Deal Economics
Starting today Office Depot & Officemax are running an instant rebate on Visa gift cards. Unlike past deals where the rebate more than offset the fees, this time you will be shelling out some money for the privilege of buying these cards. Does it make sense to do that?
- Save $10 instantly when you buy $300 or more in Visa gift cards.
- Limit 1 offer per customer.
- Discount applied at register.
- Offer valid 6/4/17 through 6/10/17
Previous offers have had a rebate as high as $20, although it has been $15 most recently. You also used to be able to receive 2 rebates per transaction for a long time. So for example, when purchasing $600 in cards with a $15 instant rebate X 2 the math worked out like this:
- Cost of Cards: $620.85 (3 * $206.95)
- Minus Rebate: $-30
- Final Cost: $590.85
- Profit: $9.15
- Points Earned at 5X: 2,954
This was really great since you could walk out with a few bucks PLUS you could earn 5X with a Chase Ink Plus/Cash card or 5% back with a Amex SimplyCash. Heck, even if you were earning 2% back with another card or using a card to meet minimum spend it could make sense under the right circumstances.
The New Math
Unfortunately now the rebate is only $10 and you have a limit of 1 per transaction. Some stores will allow you to do multiple transactions but that is of course not guaranteed. In other words you are going to make the effort to go into a store without any guarantee that you will get more than 1 rebate. And the math looks like this:
- 2 X $200 Visas: $413.90
- Minus Rebate: $-10
- Final Cost: $403.90
- Profit: -$3.90
Economics of 5X
So now you are going to pay almost $4 for these cards. So does it make sense? Well let’s first look at the math using a 5X card such as the Chase Ink Plus/Cash.
- Points Earned: 2,070
- Points Value (1.5 CPP): $31.05
I personally value Ultimate Rewards conservatively at 1.5 cents each. In that case a single rebate will net me $31.05 in points for a cost of $3.90. That is a cost per point of $.0019 or about 1/5 of a cent. An excellent value.
With that said, you must factor in your time. If you are making a profit of ~$27.15 on the purchase, does it make sense to spend time driving to the store given the limit of 1? I would say no, unless you have a store that you know will let you do multiple transactions or one that is very close. Also, don’t forget to factor in liquidation time.
For Minimum Spend
Does it make sense to utilize this deal for minimum spend? It might. To start, Amex and U.S. Bank have been known to crack down on gift card purchases to meet minimum spend so keep that in mind. Other than that, this is a very low cost for cards which can easily be liquidated. If you struggle to meet spend or want to quickly get spend out of the way, then this is an excellent deal.
The bottom line is that this deal is about half as good as previous incarnations due to a limit of 1 and a lower rebate amount. With that said, for those who can do multiple transactions or for those who are looking to meet spend, this might make a lot of sense. If you are someone who constantly finds it takes longer than you anticipated to buy and liquidate cards at Office Depot, then you might actually be losing money when factoring in your time.